Organization Practice

The boss factor

How you get along with your manager can shape your
health, happiness, and productivity.

© Tom Werner/Getty Images

April 2021
 In this episode of The McKinsey Podcast, Diane The greater good of being good
Brady speaks with McKinsey’s Tera Allas about the
Diane Brady: I’m surprised at how high the number
impact that your relationship with your boss has on
is in terms of the dissatisfaction.
satisfaction on the job and in life. An edited version
of their conversation follows.
Tera Allas: There are a lot of very good bosses, and
then there are a lot of very bad bosses. And even the
Diane Brady: Hello, and welcome to The McKinsey
very good bosses don’t necessarily realize that their
Podcast. I’m Diane Brady. Every business wants to do
impact on the people who work with them goes well
well, both in society and, of course, in its bottom line.
beyond the business. The impact [bosses have]
And one of the most important factors, it turns out, is
inside the workplace actually bleeds into a person’s
the boss factor. What is it? Tera Allas, the director of
overall life satisfaction. And there are organizations
research and economics in McKinsey’s UK and
in which you tend to see some concentrations of
Ireland office, is here to tell us. Welcome, Tera.
good and bad bosses.

Tera Allas: Hi, Diane.

For example, if you have good bosses, then
you’re more likely to be a good boss yourself.
Diane Brady: So what is the boss factor?
That’s because you see that as the role model
and recognize that that’s what is expected and
Tera Allas: The boss factor is the fact that bosses
appreciated in your firm. You also personally
have an enormous influence on workers’ well-being
feel the effects of having a nice boss, a boss
through their relationships. And it turns out that
who empathizes with you and cares about you
people’s job satisfaction has an enormous influence
as a person.
on their overall life satisfaction. Things like health
and mental health are obviously important for
Diane Brady: Do you think that the pandemic
whether somebody’s happy in their lives. After that,
has exacerbated the tensions that we have with
the second most important thing is whether they’re
our boss?
happy in their job. And there, the most important
factor is their relationship with their boss. Bosses
Tera Allas: That’s a really interesting question. The
have a huge influence—not just on the financial
evidence to date is mixed. In some ways it depends
performance of businesses but also on the
both on the employee and the boss, and the boss’s
well-being of the workers, and hence, the
style. Before I even get into that, we should
business’s societal impact.
remember that around 60 percent of all people—
in the US and also in most developed economies—
Diane Brady: What prompted you to look at this
can’t actually work remotely.
right now?
So it’s really only the 40 percent who could even,
Tera Allas: We started looking at measures beyond
in theory, work from home—office workers and
shareholder value and GDP [gross domestic product,
knowledge workers. The 60 percent who can’t work
a measure of the economic output of a country] a
from home are people like dentists, or bus drivers,
while back. When you look at those factors, you come
or beauticians, or similar.
across measurements of life satisfaction. And when
you look at the data, you quickly realize that bosses
We shouldn’t leave anyone out of the equation, but
are very important.
just among office workers, there seem to be a lot of
different segments. Certain individuals seem to take
There’s this paradox. On one hand, your relationship
to remote working really well; it improves their well-
with your boss is by far the most important thing
being and their productivity. Others find it a struggle,
in terms of your job satisfaction. But more than
whether for personal reasons or because their
70 percent of people say that spending time with their
environment is not ideal.
boss is the most stressful time of the entire working
week. There is clearly room for improvement here.

2 The boss factor

Certain bosses are very good at maintaining and
building relationships even when that relationship is
remote, when you can only communicate by phone
or by videoconferencing. Other bosses are really
bad at maintaining relationships in general, which is
probably made worse by trying to manage remotely.
So I don’t think there’s a universal, single experience
that people are having.
Some recent research that is quite intriguing
indicates that many people who’ve started to work
from home are finding it somewhat liberating. They
feel that they have a little bit more autonomy. We
know from previous research that autonomy is an
incredibly important part of feeling satisfied with
your own job—feeling that you have some say over
how things get done, when they get done, and that
you’re trusted and empowered to get it done. So I
suspect there will be people who are actually feeling
quite good about their current situation.
A foundation of trust
Diane Brady: So if your boss is not quite as powerful
in your life as before, that would make you happier?
Tera Allas: I think it’s not necessarily about how
powerful they are but also what their attitude is.
Obviously, for a remote-working relationship to work
well, there needs to be trust. The employee needs to
do the work.
‘There’s a lot of research suggesting that
celebrating really small steps is critical
to people reaching big goals. I think it is
an important way of buoying and
enhancing well-being.’
The boss factor
Perhaps more bosses have realized that, in this
pandemic, the only way they’re going to have an
effective team that still continues to deliver, despite
enormous pressures from inside and outside of the
business, is by building trust and by putting extra
effort into spending time with people to really
connect with them. Otherwise, there would be real
concerns about burnout and people not being able
to draw boundaries between work and home when
they’re working from home.
Really good bosses listen to all that information
and change the way they behave, perhaps enabling
a much more independent way of working. You
can’t just tell people to work independently; you
also have to change processes, such as how you’re
meeting, how you’re communicating, to make that
possible. For the boss, that can mean quite a bit of
effort. But many bosses who have made those
changes find that it’s worth the investment because
the team is not only happier with how they’re
working but also more effective. And it’s less work
for the boss if they’re not micromanaging.
Diane Brady: When I hear the term “servant leader,”
it strikes me that the qualities that propel one to be a
leader are not necessarily the qualities that make for
a good boss.
Tera Allas: That’s exactly right. The research that we
looked at suggests that the characteristics that tend
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 to get you promoted are not necessarily the kind of
characteristics that might go with being a good
servant leader. Now, of course, there’s a middle way.
And there are people who have both. But generally
speaking, people who tend to get promoted are
quite self-centered and very focused on their
individual performance. They are also very good at
articulating their own point of view and, therefore,
perhaps not what servant leaders really do. Servant
leaders provide a platform for their employees to
provide their best work—really praising them and
supporting them, rather than elevating themselves.
Now, there are organizations which are starting to
really look at those promotion and cultural issues
to make sure that it is the servant leaders that get
promoted. But those organizations are still few and
far between.
How to be a better boss
Diane Brady: What can one do to be a better boss?
Tera Allas: The first thing is just caring—caring
about your employees, asking them how they’re
doing, and actually wanting to know what they say.
Then engaging with them on that level. And if they’re
feeling terrible, trying to understand why.
It’s a bit like being a parent. There isn’t the right
or wrong way to respond. But you do want to be
nonjudgmental and empathetic to understand
what’s going on with that person, and how you might
be able to help or how, together, you might be able
to solve that problem.
That is enormously important for building trust and
building this concept of psychological safety—
where people feel safe to be innovative, to raise
issues when the business is not going great, to come
up with new ideas, to be change-ready. Empathy is
really critical. The other thing that I’ve practiced
myself is just thanking people for everything all the
time. Even if it’s something quite small that they did,
they deserve thanks for it—even if it’s something
that’s part of their job.
4 The boss factor
Why not thank them? First of all, I am thankful.
Second of all, it costs me absolutely nothing. Third, it
makes that person feel better. There’s a lot of
research suggesting that celebrating really small
steps is critical to people reaching big goals. I think it
is an important way of buoying and enhancing well-
being, satisfaction, and happiness in the team.
To do these things well, to do them from the heart
rather than from just the head, requires that the
leader have some self-knowledge as well. They
recognize the importance of that emotional
connection with their workers.
That’s not easy for everyone. I think managers and
leaders can do a lot of things just in terms of building
their self-awareness, whether it’s signing up with a
coach, taking some time for reflection, or asking for
feedback. All those things will help them in their role
as a leader. It might make them a bit more humble,
and therefore allow them to better observe what
impact they have on the people around them.
The influence of bosses cuts
across borders
Diane Brady: Did you notice any particular
differences in terms of demographics or
geographic differences?
Tera Allas: Once you correct for basic features like
income levels and so on, there are surprisingly few
differences—whether it is between different ages,
different geographies, or different genders. To me,
this speaks to the universality of the boss factor.
In some ways, it doesn’t surprise me. The world is
ultimately made up of people, and people ultimately
thrive on relationships. That’s really important for
how they feel about themselves and how well they’re
then able to perform. And so, in some ways, you
would expect this to be the case across all kinds
of businesses.
‘It’s a bit like being a parent. There
isn’t the right or wrong way to respond.
But you do want to be nonjudgmental
and empathetic to understand what’s
going on.’
Where we did see some differences was by sector.
I talked earlier on about this idea that the more
autonomous people feel and the more trusted they
feel to get on with their work, the more empowered
and happier they are not only in their jobs but also in
their lives.
There are many sectors—particularly professional
services and creative industries—where people can
have those kinds of roles. But there are also quite a
few sectors where people do not feel that they can
do their jobs autonomously, where the culture is a
little bit more top-down command and control. I
suspect that if we were able to dig deeper into that,
we would find that, even in those sectors, there’s
some businesses that are able to bring much more
of that kind of autonomy to bear.
It doesn’t really take much. Even if you’re, say, in a
manufacturing setting, one of the things you can do
is have a five-minute meeting at the beginning of
every shift to say, “How is everybody? Do you have
any ideas about how we could improve what we’re
doing today?”
Obviously, you can always start doing that once
you’ve already built some trust with your workers,
but if you create that culture and environment of
soliciting ideas bottom-up, and giving people a
sense that they own a lot of what happens in the
team and in the factory or in the workplace that
you’re talking about, then you can do it in pretty
much any sector.
The boss factor
Diane Brady: I’m intrigued by how this ties back
to success.
Tera Allas: There’s now a lot of research showing
that happier employees are more productive, more
engaged, and more loyal. They generate better
customer loyalty and are less likely to leave. All of
these positive feedback loops mean that it’s a win–
win. And then looking at the data, it was just so stark,
this impact that the bosses have: that the vast
majority of somebody’s job satisfaction is really
about how they perceive their relationship with their
boss. You would think that it could be things like pay
or how exciting or interesting or important their job
is. But actually, the biggest impact is from their
relationship with their boss, even if what they’re
doing is a pretty mundane job.
So that got us thinking that there’s something
missing in the ESG [environmental, social, and
governance] debate. People are looking outside.
They’re looking to how you can help the community,
or how you can help your supply chains, or how you
can reduce your environmental footprint. But the
truth is that by looking inside, and looking at the
often thousands of people that large companies
employ, you could actually make a huge contribution
to society by just making sure that those people are
better off from a well-being perspective, that they’re
more satisfied with their lives because they’re more
satisfied with their jobs.
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 Promote people on values—
and performance
Diane Brady: Should this alter how we think about
promoting people?
Tera Allas: Definitely. Promotion and other kinds of
recognition send a powerful signal to everybody
who works at an organization. It’s a powerful way of
essentially changing behaviors. If you don’t change
who you promote, then you might be saying with your
words that you would like your organization to be an
inclusive one that looks after the well-being of
employees. But if that’s not backed up by actual
actions when it comes to other promoting people—if
you promote people who are superstars in terms of
delivering, say, customer accounts and sales but
who actually treat their people badly—then you’re
sending a very conflicting signal.
Actions speak louder than words. You have
to change how you praise and promote people,
how you appraise them. When everybody has
their performance reviews, what gets looked at
and emphasized?
You also need the bosses at the very top—the
executive cadre—in their day-to-day experience
with the people who they work with, to be showing
and exhibiting these traits. Then the people who are
looking up to the role models at the top of the
organization can recognize that this is important,
that they mean it when they say it.
Diane Brady: What is the advice you have for
leaders to get to a place where they can even start
to be better bosses?
Tera Allas: That’s an incredibly important question,
and even though it sounds easy, it’s not necessarily
easy. And part of that is because an awful lot of us
haven’t gotten used to, or haven’t been taught to,
bring our emotions and our whole self to work. And
if you’ve done something that’s made you fairly
successful, that has excluded that [emotional]
dimension of you, then relearning and reopening
up to that dimension takes a bit of time.
6 The boss factor
I would say there are two different approaches, and
you may want to do both in parallel. The first one, of
course, is that there are many training courses and
coaches that can help you with that kind of
unfreezing of how you think about yourself in the
workplace, and how you think about your success,
and how you think about the value you create. An
enormous amount of value that you can create is by
just being really nice to the people you work with
because that makes their lives better. And what is
more important than making people’s lives better?
And as a bottom-line impact, as a bonus, you’ll also
get better performance from the team. So there’s
that kind of unfreezing, opening up, maybe by using
coaching or training or, in some cases, even things
like meditation or self-exploration.
Fake it until you feel it
But the other thing I have found is that, in some
cases, just fake it till you make it. So, with something
like thanking everybody, I would basically challenge
everyone to ask, “Do you really not want to thank
them?” I think everybody could find one or two
things to thank everybody on their team about every
day in a way that is sincere. The beauty of the fake-
it-till-you-make-it approach is that, when you start
seeing the positive effects that it has on people and
their energy levels and their joy at work, you want to
do more of it. Then suddenly it’s not faking anymore.
You’re actually just doing it because you want to do it,
because you can see and feel the benefits yourself.
So I think every leader and every boss will perhaps
want to take their own approach to this.
Think about what makes you feel safe, or in a place of
psychological safety, so you feel able to take those
steps. And then think also about what are some of
the really small things you could start doing today
that can build up to a workplace where people feel
appreciated, and they feel trusted, and they feel that
their boss is in their corner.
Diane Brady: Do you see a different kind of role for
the boss going forward?
Tera Allas: I think COVID-19, and automation, and
the future of work, all of these are pressures that are
piling up on top of existing pressures. And in that
sense, I see the importance of the role of the boss
growing. So, yes, there’s going to be more change
in the workplace.
That change is going to need to be handled by
bosses who are sensitive to how they can support
their workers to move into a different set of tasks or
learn a new set of skills. Also, more and more of the
jobs that we’re going to see humans do in the future,
as opposed to machines—that can do lots of
calculations and lots of automated tasks really well—
are going to increasingly involve working with other
humans, for example, in the customer interface or in
the healthcare sector or public sector. The boss of
the future will need to have excellent emotional
intelligence to be able to not just command and
control a team but actually support them to do what
they, as the frontline workers, know is the best thing
to do for any particular customer or any particular
patient, say, in a hospital.
I think that’s going to be a bit of a revelation for
certain types of leaders or managers, who’ve maybe
grown up in a slightly more command-and-control
environment. Once they move into a situation where
they’re managing large groups of people—and not
just people in a technocratic way but people in a
people occupation—there will be many aspects that
will come through, which will reinforce the things
that we suggest around psychological safety, trust,
and building those relationships, and really just
helping people to have meaningful jobs that they
look forward to coming to.
Diane Brady: We’ve talked a lot about the boss
and what they can do to be better. How can we, as
individual team members, help our bosses be
Tera Allas is director of research and economics in McKinsey’s London office. Diane Brady is a senior editor based in the
New York office.
Designed by McKinsey Global Publishing
Copyright © 2021 McKinsey & Company. All rights reserved.
The boss factor
better? Since we seem to be unhappy according to
the research that you’ve done, how can we basically
make this situation more palatable?
Tera Allas: Not everybody’s unhappy, but there’s
definitely room for improvement in most cases, in
most organizations, and in most teams. It’s kind of
the same thing in some ways but in reverse. It’s all
about relationships. And how you build a good
relationship with your employees is pretty much the
same as how you would build a good relationship
with your boss: accepting that they’re human.
Understanding that they will occasionally be
stressed out. Recognizing and empathizing with the
pressures they’re under. And building that kind of
trust-based communication that allows you to
understand what’s going on with them, and perhaps
invites them to ask what’s going on with you.
If you want to be empowered and you want to be
given a role that’s autonomous, then you do need to
show that you can be trusted. You need to be
reliable. You need to do what you promised you
would do and create a mutual recognition—and that,
I think, would be a win–win, both for the boss and
the employee.
Diane Brady: Very good advice. Thank you very
much for joining us, Tera.
Tera Allas: Thank you, Diane. My pleasure.
Diane Brady: And thank you, all of you, who have
tuned in. To read more about the boss factor, please
see, “The boss factor: Making the world a better
place through workplace relationships,” by Tera
Allas and Bill Schaninger, on McKinsey.com. That
was Tera Allas, who is the director of research and
economics in McKinsey’s UK and Ireland office. I’m
Diane Brady. Thanks for listening.
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